The new laws for the estate tax in New York are going to benefit a lot of state citizens in the upper middle class, many of whom have worked over the course of a lifetime to accumulate their wealth.
Not everyone will benefit from the laws, however, as the financial “cliff” included in the language of the new law may raise the marginal tax rate for some individuals, according to Newsday. On April 1, the state’s estate tax exemption rose to over $2 million, more than doubling the previous exemption of $1 million. Further, the exclusion will continue to rise by $1,062,500 every April 1 until 2017.
Photo courtesy of Florian Giorgio (Unsplash.com)
By 2017, the New York state estate tax exemption will match the federal estate tax exclusion, which currently sits at $5.34 million, the news source explained. At this point, the state’s exemption will be indexed for inflation like the federal exemption.
This new law means that the majority of New York residents will be able to pass on their estates tax-free. Descendants of those that are above the exemption, however, may now face a larger tax bill than they otherwise would have, The Times Beacon Record explained. If the estate is valued between 100 percent and 105 percent of the exclusion amount, the additional sum will be taxed.
This means that an estate of $2,165,625 would only be taxed on the amount in excess of the $2,062,500 exemption this year – $103,125. However, an estate valued at only $1 more would be subject to tax on the entire sum of the estate. Further, the new estate tax law adds a limited three-year look back period for gifts made between April 1, 2014 and Jan. 1, 2019, during which time the value of any taxable gift is added back into the estate.
One of the reasons for the new estate tax law in New York was to make the state more attractive to wealthy seniors, according to Newsday. The wealthiest among them, however, may find better states in which to pass on their estates.
Understanding Chattel Paper: A Key Component in Secured Transactions
Using chattel paper to obtain a security interest in personal property is a powerful tool. It can ensure lenders have a legal claim on collateral ranging from inventory to intellectual property. To reduce risk and protect your legal rights, businesses and lenders should understand the legal framework. This framework governs the creation, sale, and enforcement […]
For years, digital assets operated in a legal gray area, a frontier where innovation outpaced the reach of regulators and law enforcement. In this early “Wild West” phase of finance, crypto startups thrived under minimal oversight. That era, however, is coming to an end. The importance of crypto compliance has become paramount as cryptocurrency has […]
Supreme Court and Title VII: Implications for Reverse Discrimination
Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]
Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]
Short Form Merger: Streamlining the Process for Businesses
Merging two companies is a complex legal and business transaction. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process that involves important corporate governance considerations. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process. However, […]
Tariff Response Options for Small Businesses Facing Financial Distress
The Trump Administration’s new tariffs are having an oversized impact on small businesses, which already tend to operate on razor thin margins. Many businesses have been forced to raise prices, find new suppliers, lay off staff, and delay growth plans. For businesses facing even more dire financial circumstances, there are additional tariff response options, including […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
